The proposed Credit Card Competition Act has earned attention from major airlines and travelers due to potential impacts on credit card rewards programs. The bill aims to introduce more competition into the credit card market, which could lead to changes in fees and rewards structures. Small town airports, especially in Louisiana, are concerned about the repercussions if these rewards programs are altered or eliminated.
According to data from the Federal Reserve, over 80% of Americans use credit cards to make payments, get cash back, and build credit. About 40% of these individuals have a card co-branded with a major airline, which offers rewards such as points and miles that can be redeemed for travel benefits, thereby making air travel more affordable for areas spread across Louisiana that are served by smaller airports like Alexandria International Airport, Shreveport Downtown Airport, Lake Charles Regional Airport, Monroe Regional Airport, and Lafayette Regional Airport.
Major airlines have voiced opposition to the bill, citing potential impacts on their ability to reward loyal customers and maintain the viability of rewards programs. Southwest Airlines, for instance, has expressed that they "strongly oppose" the bill and that it would "undermine, if not completely end, credit card rewards programs."
Statistics from Airlines.Org underscore the impact of credit card-based travel rewards, with 15 million Americans booking air travel annually using points from airline credit cards. These cards play a crucial role in economic activity, generating billions of dollars in 2022 alone. However, Airlines.Org also emphasized that this practice would end if Congress passes the Durbin-Marshall credit card bill.
However, the bill's lead sponsor, Sen. Dick Durbin, argues that the bill would introduce necessary competition into the credit card industry and prevent airlines from excessively controlling reward programs. Many experts argue that the bill would not lower prices for consumers and would instead prompt airlines and credit card companies to offer fewer rewards.
The possible elimination or alteration of rewards programs could have significant consequences for small airports in Louisiana. Without these programs, air travel may become less affordable for residents, likely leading to airport closures. The potential consequences of this issue could be far-reaching, affecting daily life, including access to medical services, job opportunities, and social connections..
Across the country, airline credit cards have a significant impact on making air travel more accessible and affordable for millions of Americans, with a significant portion of households holding these cards. Beyond rewards, their influence plays a vital role in increasing the accessibility of air travel nationwide.